EXCLUSIVE: Foxtons targets national market in growth plans
Foxtons CEO Guy Gittins tells The Neg his vision for the London agency is expansion across the whole of the UK with 500-600 offices.
Foxtons’ long-term aim is to become a national agency covering the whole of the UK, CEO Guy Gittins (main picture) revealed to The Neg.
As the London-based agency announced its full-year results yesterday, Gittins said he would like to see 500-600 Foxtons offices covering all regions.
Achieving £25-£30 million of operating profit with “rapid acquisitions” was the immediate aim, he said.
And there was still plenty of scope for growth within the M25, he said. “We will always look at high volume, high value commuter belt locations.”
The Foxtons network is currently made up of over 50 offices, almost entirely in the Greater London area.
500-600 offices up and down the UK would be transformational.”
The target though is to one day expand outside of London: “500-600 offices up and down the UK would be transformational, but that’s a long, long-term opportunity,” he explained.
Gittins and CFO Chris Hough were keen to stress that while the company’s profit before tax was down 34% to £7.9 million, the adjusted figure was up 2%, and so far this year the transaction figures look promising.
The agency said profit before tax was down after charging £4.5m of ‘adjusted items’ mainly due to the costs of integrating Ludlow Thompson and “branch network consolidation”.
Acquisitions
More acquisitions are on the cards, Gittins said, probably towards the end of the year.
He doesn’t see any prospect of the business being sold as some investors have urged, especially as the share price is doing so well.
Shares jump
Recently, The Neg reported Foxtons has seen its shares jump more than 50% in six months despite a slump in sales.
The share price is up to 58p from 37p last August, and has leapt 5% in the last month alone.
Other results announced this week showed revenue was up 5% to £147.1m and adjusted operating profit up 2% to £14.3m. But sales revenue was down 14% to £37.2m
Adjusted EBITDA rose 6% to £17.5m. Adjusted profit before tax was up 3% at £12.4m (2022: £12.0m).
Foxtons is undervalued, and with so much M/A activity at present it is a 60/40 bet that by the end of 2025 it will be under new ownership. So perhaps the trumpeting of rapid expansion aligns with driving a better price, also Guy has been in post less than two years so maybe September 2024 onwards when he has officially been in the driving seat for 24 months the board might see better where everything is heading. It is interesting also that Foxtons genesis was built upon being open all hours in the early 1980’s, to capture market share, now with digital all agents are open 24/7 so that USP has long since vanished.